KARACHI, Nov 15: At the Annual General Meeting (AGM) to be held on November 29, shareholders in Jahangir Siddiqui & Company Limited would have reason to rejoice.

Last year the company had earned consolidated post tax profit amounting to Rs 551m, which was the highest ever in its history. But the company does not seem to have sat on its laurels for in the first quarter of the current year (July-Sept 2003), the company has already logged in after tax profit in the sum of Rs332m. And that works out to nearly eight times the net profit of Rs43 million that the company had earned in the corresponding quarter of the previous year.

Earning per share (eps) for the quarter stood at Rs9.18, up from Rs1.37 in the similar period of 2002.

The share of the face value of Rs10 in Jahangir Siddiqui & Co Ltd (JSCL), which stood quoted at Rs27 at the start of this calendar year, has since climbed to Rs48, reflecting an appreciation in value by a staggering 78 per cent. The stock has outperformed the Karachi Stock Exchange index of 100 shares, by a margin of 35pc, for the overall market has risen by 43 per cent in eleven months of the current year.

Much of the massive growth in group profit and the rise in stock price has been on the back of a relentless bull market and the company’s ability to have seized the opportunity. JSCL (not including its subsidiaries) has added a billion rupees to the company’s market value, which has climbed to Rs1680m currently, from Rs675 in January, both due to the rise in share price as well as increase in number of outstanding shares. Directors are noted to have followed a consistent and balanced appropriation policy so that while a good portion of year’s earnings is retained to strengthen the balance sheet, shareholders also get to share in the fruits of prosperity.

Unlike some of its peers, the company has not denied shareholders a cash dividend in any of the last 10 years.

JSCL boasts as the first securities brokerage firm in Pakistan’s financial market that had a Wall Street pedigree (through its former joint-venture partner Bear Stearns).

Over the past few years, the company has expanded into diverse activities in the financial services sector. It acquired 62.4 per cent sponsors’ shares along with management in Citicorp Investment Bank (listed in 1993) from Citibank Overseas Investment Corporation (COIC) and the bank got eventually to be renamed as Jahangir Siddiqui Investment Bank Limited.

For the latest first quarter (July-Sept 2003), the bank reported after tax profit at Rs205m, which is a multiple of 14 times the net earnings of Rs15m that the bank had made in the corresponding period of the previous year. JSCL owns 53.74pc shares in ABAMCO Limited — the Investment Advisor and Asset Management Company — and 42.77pc equity of Confidence Financial services Limited (a sub-subsidiary).

During the quarter under review, JSCL transferred certain businesses into its wholly owned subsidiary, Jahangir Siddiqui Capital Markets (Pvt) Ltd (JSCM). The company said that the business divisions transferred were equity, fixed income and currency brokerage, research and corporate finance.

Those divisions represented the company’s agency businesses. The company said it would focus on principal investing both in equity public and private and fixed income securities while agency businesses would be carried out on an arms length basis by JSCM.

Consolidated balance sheet of JSCL at September 30, 2003 showed intangible assets amounting to Rs174 million; long term investments at Rs1,322m; short term investments at Rs2,446 million; fund placements at Rs1,150 million and the balance sheet footing at Rs5.6 billion.

Directors observed that The Pakistan Credit Rating Agency (Pvt) Limited (PACRA) had maintained long term rating of “AA” (Double AA) and the short term rating of “A1+” (A one plus). Long term rating denoted a very low expectation of credit risk and indicated a very strong capacity for timely payment of financial commitments, while short term rating denoted that obligations were supported by the highest capacity for timely repayment.